- This is Indus Motor’s fifth announcement of production closure this year
Indus Motor Company (IMC), the assembler of Toyota vehicles in Pakistan, has once again decided to shut production citing raw material and component shortages. This time production will be suspended from June 26 to June 27.
The automaker shared the development in a notice to the Pakistan Stock Exchange (PSX) on Friday.
The automaker said that the company and its vendors continue to face hurdles on import of raw materials and receiving clearance of their consignments, on account of challenges in opening of Letters of Credit (LCs) and supply issues by certain foreign vendors.
“This has disrupted the supply chain of the company and the vendors are unable to supply raw materials and components to the company. Accordingly, the company has insufficient inventory levels to maintain production, therefore the company is unable to continue its production activities,” it said.
“In view of the above, the company has decided to completely shut down its production plant from 26 June 2023 to 27 June 2023 (both days inclusive),” it added.
This is Indus Motor’s fifth announcement of production closure this year. Earlier, the company announced a complete shutdown of its plant from June 3 to June 8, May 2 to May 3, February 1 to February 14, and then again from March 24 to March 27 citing inventory shortage.
Auto sector woes
The country’s auto sector, hugely dependent on imports, has been hit hard by the government’s decision to curb imports and restrict issuance of LCs. Additionally, higher finance cost and massive increase in car prices have also reduced demand from consumers.
IMC reported a profit-after-tax (PAT) of Rs3.216 billion for the third quarter of financial year 2022-23, a decrease of 37% as compared with earnings of Rs5.118 billion in the same period of the previous year.
On a quarterly basis, the PAT of Indus Motor was up by 142%.